REDESCA Urges Integration of Human Rights into Global Fiscal Reforms and Climate Financing

August 12, 2024

Washington, D.C. - In a global context marked by the intensification of the climate crisis, the Special Rapporteurship on Economic, Social, Cultural, and Environmental Rights (REDESCA) of the Inter-American Commission on Human Rights (IACHR) reaffirms the importance of implementing progressive fiscal policies that promote and guarantee human rights. In line with this, it recognizes the relevance of ongoing global fiscal reform processes in multilateral forums. In particular, it highlights the importance of the recent declaration by the G20 finance ministers, which advocates for advancing progressive fiscal reforms and the need to mobilize additional resources to address the climate emergency and achieve the objectives of the 2030 Agenda.

In the context of these discussions on global tax reforms, the United Nations General Assembly has initiated a process to develop a Framework Convention on International Tax Cooperation. Resolution A/78/230, adopted last year, marks the beginning of intergovernmental discussions at the UN to strengthen the inclusiveness and effectiveness of tax cooperation, as well as the development of a process to design a legally binding framework convention. Currently, the second round of negotiations on the Terms of Reference for this process is taking place at the UN Headquarters in New York, emphasizing the importance of more inclusive and effective international tax cooperation in promoting tax justice and human rights in a context of increasing climate vulnerability.

Fiscal policy is intrinsically linked to human rights and climate justice. In this regard, under the American Convention on Human Rights and its Additional Protocol of San Salvador, States must ensure the progressive realization of Economic, Social, Cultural, and Environmental Rights (ESCER). The aforementioned obligations include the policies that States undertake to strengthen their fiscal space, raise appropriate public revenues, and allocate funds to effectively finance public policies that guarantee human rights. Therefore, while States certainly preserve sovereign discretion to define their particular fiscal and tax policies, they are simultaneously obliged, at the international level, to uphold and promote ESCER through these specific public policy decisions and their effective implementation.

Our monitoring and protection work in the region reveals that the enjoyment of ESCER in Latin America and the Caribbean is severely compromised by the structural limitations of their economies. An inequitable international financial architecture facilitates the growth of illicit financial flows, tax evasion, and profit shifting, which reduces the fiscal space needed to finance quality social and public services, depriving countries of the indispensable resources for their development. Additionally, these countries are creditors of an environmental debt that, although they largely did not generate it, confronts them with insurmountable challenges and a severe impact on the livelihoods of their populations.

Caribbean countries face the additional obstacle of limited fiscal space to bear the cost of timely and adequate adaptation and mitigation measures for severe infrastructural damage and economic disruptions because of disasters caused by climate change. These states must often resort to non-concessionary loans from other States, private investors, or international financial institutions to finance essential policies. These States are forced to choose between meeting their foreign debt repayment obligations—at the expense of austerity measures and conditionalities—or being prevented from accessing international funds for the urgent climate measures needed to confront present and future environmental challenges.

The Special Rapporteurship emphasizes the importance of debates on the development of progressive fiscal reforms, both nationally and internationally, and the urgent need to mobilize additional resources to meet climate financing objectives. It is essential that the process of developing specific instruments in multilateral forums includes human rights as a guiding principle and leads to concrete and effective reforms. REDESCA reiterates its commitment to actively contributing to these debates, which must include the participation of all governments, international organizations, and a diverse representation of civil society.

No. RD180/24

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